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Why an Unstable Middle East Could Mean an Environmental and Economic Catastrophe

As the Arab Spring gives way to heated conflict, look for high gas prices and more pollution.

We don’t yet know the full implications of the new eruptions of violence in the Middle East. The crisis does appear to be spreading well beyond Libya and Egypt, and given the increasing absence of strongman dictators, who would (at the behest of the White House) use the full weight of the state’s security apparatus to shut down these protests, the situation has the feel of Iran, circa-1979. We don't have a crystal ball, but oil supply is always a concern when conflict arises in oil-rich countires, which may well trigger high gas prices and increased environmental dangers.

Let's take a look back at that earlier period of Middle East crisis and instability. Demonstrations against the Shah commenced in October 1977, developing into a campaign of civil resistance that was partly secular and partly religious, and intensified in January 1978. Between August and December 1978, strikes and demonstrations paralyzed the country. The Shah left Iran for exile on Jan. 16, 1979 as the last Persian monarch. In the resulting power vacuum two weeks later, Ayatollah Khomeini returned to Tehran, to be greeted by several million Iranians. That ushered in today’s Iran, especially after a national referendum discontinued the monarchy and approved an Islamic Republic on April 1, 1979. In December 1979, Khomeini became Supreme Leader of the country. It produced radical change at profound speed with secular westernized monarchy ultimately replaced by a fundamentalist Islamic dominated theocracy. Iran has since become one of the hardliners of the OPEC cartel and a recurrent source of instability in the Middle East, as we see today.

The current wave of protests and violence spreading through the Middle East have already awakened worry about oil supplies. It would nice to think that such a situation would spark the U.S. to embark on a grand Manhattan Project-style national program dedicated to the growth of alternative energy sources. Of course, that’s a pipedream, and highly unlikely in the post- Solyndra Solar world which we inhabit today.

It's troubling news to environmentalists, but I suspect that there will be a lot more attention paid to areas like the Canadian oil sands projects over the next few years . The bitumen-based heavy oil is dirty, consumes lots of water and does produce enormous emissions (which is one of the reasons why virtuous Canada has been one of the persistent violators of the Kyoto protocols).  But it’s Canadian and it’s secure. Over the past 10 years, Canadian crude production has risen by 600,000 barrels per day while Mexico’s has fallen by about that same amount.  As dirty as this kind of oil production is, the recent eruptions in the Middle East are almost certainly going to change the political calculus in favor of yet more production. After all, the question will rise, wouldn’t you rather have a reliable, long-term supply of crude from Canada than rely on unreliable OPEC-based suppliers in countries full of Islamic extremists?

How long can we rely on the Canadian oil sands? Probably for decades. The resources there are estimated at over 100 billion barrels. 

As far as the proximate cause of the riots now all over the region, we know that there were almost no protesters before the Libyan attack occurred. The attack itself was done with heavy weapons and was well-coordinated, which suggests the possibility of a planned 9/11 anniversary attack by a highly armed group of extremists.

The Libyans themselves had elected a non-Muslim government, and in the aftermath there has been an outpouring of pro-U.S. sentiment in the country. Still, it would be wrong to say that Libya is free of the scourge of Islamic extremism. After all, among the groups that overthrew Gaddafi's regime were the Benghazi Islamists whom we supported during the uprising, much as we supported the Taliban during their war against the Soviet Union. The town of Derna, which lies east of Benghazi, sent more jihadists to fight against the U.S. in Iraq than any other place in the Middle East. So the existence of an ostensibly moderate pro-West new government in Tripoli does not negate the fact that the country still harbors extremists who could have been behind the attacks. Libya is full of weapons, and it may be that the pro-U.S. government is unable to control extremists.